Author: Nick Martitsch
Compiled by: Shenchao TechFlow
In the crypto space, competition for early growth leaders is exceptionally fierce.
Due to the lack of defensive barriers in open-source software, distribution becomes a key competitive factor for decentralized protocols and their platforms. Hiring the right BD leader at the right time can significantly influence the direction of the project.
As a member of Paradigm's market expansion team, I collaborate with talent lead Dan McCarthy to help the founders recruit top growth leaders in the industry. Here are some suggestions we provided to the founders regarding hiring their first BD leader.
Do not change the founder-led sales model too early.
Transform early flexible strategies into scalable solutions.
Require candidates to have a high degree of autonomy and a deep understanding of crypto technology.
Value the execution of tactics.
Evaluate performance through auxiliary metrics.
1. Do not change the founder-led sales model too early
Founders are often the best salespeople for their own products. During the process of attracting the first customers and developing the MVP, it is crucial to maintain a founder-led sales strategy for several reasons:
You are more likely to close your first deal. For startups that have yet to launch their product, buyers primarily value the founder's ability to realize their vision rather than the current state of the product. Founders are the most effective at conveying technical details, product vision, and overall enthusiasm, which persuades customers to be the first to try untested solutions.
This helps optimize the product. In the early stages of a company, sales and product development should synchronize. Founders should maintain a close feedback loop with early customers to refine the product roadmap. Introducing new employees at this stage can cause unnecessary friction and communication barriers.
Typically, you can consider hiring the first BD leader when you have confirmed the needs of your initial user base and are ready to take the product to a broader market. If your project needs to build a broad external ecosystem before launch, this process can be expedited; but generally, it is best to do so after having a base of loyal customers.
2. Transform early flexible strategies into scalable solutions
BD leaders should translate the 'flexible strategy' used by founders to acquire their first customer into a scalable, replicable sales model to attract more clients. Here are some sales processes that this position should be responsible for in the early stages:
Choose a CRM system (such as Excel, Salesforce, Copper, etc.) that can scale with the company's growth and populate it with data from the entire target market.
Screen inbound leads, send external information to new customers, and involve the founders to help close the most important deals.
Hold weekly sales pipeline meetings to keep leadership informed on market penetration and bottlenecks in the sales process.
Create sales materials such as customer case studies, product updates, onboarding guides, etc., and test which sales points effectively drive conversions for potential customers.
Act as an internal representative of customer feedback in the product roadmap decision-making process, guiding the product team to develop key features and capabilities.
In summary, finding a BD leader who can both build sales infrastructure and manage the full sales process is crucial. Excelling in just one area is not enough.
3. Require candidates to have a high degree of autonomy and a deep understanding of crypto technology
We found that the best first BD leaders are often former startup founders or early employees who built departments from scratch in previous companies. They are acutely aware that the responsibility lies with them and have a strong sense of accountability for achieving company goals.
In addition to basic communication and organizational skills, a background in crypto technology should be a core consideration in recruitment. Here are some soft skills that can help determine if your BD leader can persevere through multiple market cycles:
Adaptability - Early sales in the crypto space differ from sales roles in established industries. In the crypto industry, market conditions and narratives are constantly changing, and growth leaders need to be flexible and develop new sales strategies, as effective methods in a bull market may not work in a bear market, and vice versa.
Resilience - Due to the cyclical nature of the industry, candidates need to have a strong drive for the mission of the crypto industry and not be easily discouraged by delayed results. Successful business development strategies are often found after multiple failures, learning, and iterations. Candidates whose motivation is solely based on short-term financial benefits will be eliminated during market downturns.
While it can be challenging to find a candidate who meets all requirements, having a highly autonomous BD leader with a background in crypto technology will lay the foundation for your success.
4. Focus on executing tactics
Most crypto startups focus too much on strategy for growth and neglect tactics. I explored the decision-making around the technical choices of several apps and found that responsiveness is often the deciding factor, such as response times to inbound inquiries, timely follow-up after calls, or the ability to resolve complex technical issues.
The cumulative effect of good tactics is key to creating long-term success, so it is crucial to prioritize candidates who can execute orderly processes to ensure leads are not overlooked. Here are some interview questions that can be used to assess a candidate's effectiveness in actual sales:
How would you categorize inbound inquiries as low, medium, and high priority? How does the sales process differ in each case?
What questions would you ask during an initial call to determine if a prospect is a good fit for us?
Do you think it's appropriate to browse a presentation while on a call with a potential client? How do you typically guide a sales call?
How quickly would you follow up with a potential client after the initial sales call? What information would you typically send them?
If a potential client loses interest, what strategies would you try to re-engage them?
If a potential client moves into the implementation phase, how would you adjust your communication style, manner, and frequency with them?
BD leaders still need to assist in formulating the company's distribution strategy, but if they cannot execute on daily details, that strategy will be difficult to implement.
5. Evaluate performance through auxiliary metrics
In emerging industries like crypto, many external factors influence the achievement of traditional growth targets such as revenue, TVL, customer count, or transaction volume. These growth targets are the result of the business development process, and while tracking these targets is important, it is equally important to measure the quality of the processes that achieve these goals.
Founders should set clear goals for business development based on market signals obtained from early sales. They should also establish a set of secondary metrics to evaluate performance in response to unforeseen market changes, regulatory shifts, or other macro events.
Here are examples of goals set by the founders for business development positions:
Core Goal: Achieve $5 million in annual recurring revenue by year-end
Key Metrics:
Number of new paying customers
Average contract value per customer
Auxiliary Metrics:
Number of deals entering the evaluation stage
Number of new leads added to the sales pipeline
Number of initial calls completed with potential clients
Number of external communications sent to potential clients
Through this framework, you will be able to mitigate some external influences in the crypto industry and ensure that the business development process operates efficiently.
